DAILY NATION Monday June 1, 2015 Opinion 13 CHANGE OF GUARD | Nnamdi Obasi Buhari has difficult task of reconciling Nigerians and reviving the economy May 29, he took the reins of a country in distress. Insecurity poses a towering challenge, the economy is in dire straits, and corruption and impunity are rife. Buhari, who won the election on the promise of change, must now urgently make good on that promise, starting by rallying Nigerians around what they have lost: a common vision for the future. The killings by the radical Islamist Boko Haram may have ebbed following recent offensives by forces from Nigeria and its neighbours, but the insurgency is not yet ended. The country is also plagued by diverse lower-intensity conflicts and unacceptable levels of criminal violence. The economy has slumped W over the past year, following an over 50 per cent plunge in the price of crude oil, whose export accounts for over 70 per cent of the government’s revenue. Economic growth slowed to 4.6 per cent in the first quarter of this year, down from 6.2 per cent in the first quarter of 2014. In recent months, the federal government has had to borrow just to pay workers. Eighteen of the 36 state governments currently owe employees back pay, some for up to nine months. Infrastructure is in disrepair hen Muhammadu Buhari assumed office as Nigeria’s president on of Nigeria’s navy, Vice Admiral Usman Jibrin, recently estimated that $2.18 billion worth of petroleum is siphoned annually. Early statements by Buhari and his transitional team suggest keen awareness of the gravity of the crises and some urgency toward engaging with them. Yet Buhari’s first task must Nigeria President Muhammadu Buhari was sworn in on May 29. and public utilities are hopelessly unreliable. Last week, electricity generation dropped to an unprecedented low. Acute scarcity of refined petroleum products has created mile-long queues of vehicles outside filling stations, grounded numerous flights, and damaged commercial life. Unemployment remains pervasive: officially, 22 million are jobless, but many believe the real figure is much higher. The country still has 10.5 million out-of-school children — the world’s highest number — many of whom may be future candidates for insurgency and organised crime. Corruption and economic crimes have brought the country to the verge of bankruptcy. Crude oil is stolen on an industrial scale. The chief be to persuade all Nigerians that he is president for the entire country and rally them around a common vision for the future. Although the recent elections ended without the widely feared violent protests, the campaign before it revealed a country deeply fractured along regional, religious, and ethnic lines. The latent contradictions and gaping discontent, between and even within major interest groups, threaten to frustrate even the most well-meaning plans for progress. Buhari, who is from the northern Katsina state, needs to constitute a competent, but also inclusive, government with credible representation from all major regional, ethnic, and religious blocs. More importantly, the new government must devote great effort to policies and programmes that will address major grievances, reconcile differences, build social cohesion, and provide better security. It also needs to engage positively with states where the outgoing People’s Democratic Party won, particularly in the Niger Delta, where long-standing economic and environmental grievances have been aggravated by the ousting of the first-ever president from the region, Goodluck Jonathan, after only one term. The administration will need all the support and assistance it can get from international partners. Such assistance should include military training and equipment, intelligence sharing, humanitarian support in the northeast, bridging loans, technical assistance, and bilateral cooperation in tracking corruption proceeds. Investment toward security and stability could greatly benefit not only Nigeria, but indeed the entire Africa region. Support in deepening democracy in Nigeria could also have positive spillover effects on democracy across Africa. If Buhari succeeds in de- livering on his promise of change, he will have achieved a historic reversal of Nigeria’s long slide towards degradation. If he fails, the country will slide deeper into ruin. The stakes could not be higher. Mr Obasi is a senior analyst, Nigeria, for International Crisis Group. @NnamdiObasi THE CUTTING EDGE BY THE WATCHMAN CULTURE SHOCK. Doesn’t lawyer Felix Kiprono, who reportedly wants to marry American President Barack Obama’s daughter Malia realise that at only 16, she is a minor? asks Juliet Hope. The man, she advises, should also be informed that “while it may be accepted in Kenyan culture to offer livestock for a bride, the idea of bride price is frowned upon in Western culture as it is viewed as insulting to women. Kiprono, who says he has been harbouring feelings towards her since 2008, should be arrested as potential child-sex offender.” Her contact is juliet2010hope@gmail.com. DANGEROUS ROAD. The Limuru-Raini Road, which runs through a hilly area, is full of huge potholes, especially the stretch between Ruaka and Banana townships, says David Mwangi. As a result, he adds, accidents occur almost daily as motorists weave around the potholes while going down the slope on the slippery surface during this rainy season. David is accusing the Kiambu County Government of totally neglecting the road, necessitating a major overhaul when routine maintenance could have done the trick. His contact is mc_davi@yahoo.co.uk. FADING DREAM. Some 500 days have passed since he applied for electricity connection to his ageing mother’s house in Nyeri County, and Antony Mwangi now fears that her chances of ever realising that dream are fading fast. At 75, he adds, she might not be lucky to see electricity in her house in her lifetime. But to his utter chagrin, he adds, some of his neighbours who applied much later have already been connected. The reference is E25102014020040 and his contact, tonimwangi2000@yahoo.com. A rescue operation at a collapsed building in Nairobi. DAYLIGHT ROBBERY. By keeping quiet as people ECONOMY | Robert Mudida Bank of Kenya (CBK) decide to concentrate on stabilising it in the wake of the recent market shock. The shilling’s current weight of 0.96 A fine balancing act required over shilling C ontrary to the global currency trends, the shilling may actually be headed up, should the Central against the dollar is a reflective response to the global trends recorded by the improving value of the dollar. This is being experienced at both the regional and global level, an appreciation resonating with the US economy over the past few months. The trend has restored confidence in the US economy, which means that investors are more willing to invest in US financial instruments and other dollardominated assets. The European economy is also recovering, but much more slowly, picking up from the euro zone crisis. This depreciation of the local currency has been influenced more by global trends than local economic imbalances. It is a worrying trend to some extent because it means that the cost of imports, mainly consumer goods, will increase, contributing to inflation. If inflation increases, then the CBK Monetary Policy Committee would probably have to increase interest rates, which would have other consequences. On the other hand, exporters are up for There is a need to balance between growth and inflation. If the interest rate is too high, it may stifle growth. It may address inflation, but it also reduces growth, which would increase unemployment” benefits as our goods will be considered cheaper, and so goods that are responsive to decreased prices, such as tourism and horticultural products, could see some recovery. For many decades, our import value has consistently exceeded export value. We have had a deficit in our current accounts, whose major component is in trade balance. This would not be a reason for concern if it happens occasionally. However, it can be a reason for concern if it is persistent. If we have a persistent current account deficit, then that could mean that there is a challenge on the competitiveness of our exports. The balance of payments and current account deficit can be financed by drawing on reserves or by borrowing. Should these be financed by borrowing, then the country’s indebtedness would increase. Facilities such as the International Monetary Fund (IMF), which provides specific support for balance of payments, can come in useful, especially in getting emergency monetary assistance to stabilise the shilling. However, this is not a suitable option in the long run. The other option would be to raise in- terest rates. This might seem like the way to go, but it is important to remember that there is a need to balance between growth and inflation. If the interest rate is too high, it may stifle growth. It may address inflation, but it also reduces growth, which would increase unemployment. The Central Bank always has difficulties balancing these concerns and that is why it has maintained a stable rate of 8.5 per cent. The only time it could increase the rates would be if inflation goes up substantially, probably over 10 per cent. The IMF recently predicted that Ken- ya’s economy could grow by 7 per cent next year. This would all be lost should Central Bank make the wrong decision about rectifying the current situation with the shilling Dr Mudida is academic director at the Centre for Public Policy and Competitiveness at the Strathmore Business School who never benefited from university loans are charged Sh1,000 for a clearance letter, the Higher Education Loans Board is literally abetting theft, charges Laureen Amateshe. She is disappointed to note that one of the requirements in a suitability for employment form at her work place is a Helb clearance certificate. “Those who benefited from the loans do not pay the fee and those who did not are charged Sh1,000 for the certificate. This is theft in broad daylight.” Her contact is khamateshe@yahoo.com. TOTAL BLACKOUT. Before moving to Wundanyi in Taita-Taveta County from Nairobi recently, Stephen Mkala had bought a GoTV set top box for his family. To his surprise, the thing has proved useless as he cannot get any of the channels he was able to watch in Nairobi. This has left his family in a total blackout, with analogue broadcasting that once served the area so well having been switched off to usher in the digital era. “What can I do?” asks Stephen, who can be reached through Tel. 0722-362505. ESCAPING RESPONSIBILITY. When the City Planning Officer says his officials cannot be at every site under construction to ensure that everything is done properly and according to the laid-down specifications, Ruth Gituma says that really scares her and should be a source of concern for the top leadership. Rejecting the officer’s stance, she asks: “Why do they have inspectors in the department? Who checks and clears those buildings that come tumbling down?” Her contact is rgitum@gmail.com. Have an answerable day, won’t you! E-mail: watchman@ke.nationmedia.com or write to Watchman, POB 49010, Nairobi 00100. Fax 2213946.